D, E, F are partners in DEF partnership with profit or loss sharing ratio of 6:1:3 D, E and F are partners in DEF Partnership with profit or loss sharingratio of 6:1:3. Due to disagreement, the partners decided toliquidate their business with pre-liquidation statement of financialposition presented below:CashP 3,000,000LiabilitiesP10,000,000Noncash assets 17,000,000D, Capital1,000,000E, Capital4,000,000F, Capital5,000,000The following additional notes are provided:All partners are legally declared to be personally insolvent.All noncash assets are sold during the liquidation process.Liquidation expenses amounting to P2,000,000 were paid.• E receives a total of P2,500,000 at the end of liquidation.What is the amount received by F at the end of liquidation?

E, Capital Balance before liquidation P40,00,000 Less: Amount Received by E at the end of…

Answered: D, E and F are partners in DEF…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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D, E, F are partners in DEF partnership with profit or loss sharing ratio of 6:1:3

D, E and F are partners in DEF Partnership with profit or loss sharing
ratio of 6:1:3. Due to disagreement, the partners decided to
liquidate their business with pre-liquidation statement of financial
position presented below:
Cash
P 3,000,000
Liabilities
P10,000,000
Noncash assets 17,000,000
D, Capital
1,000,000
E, Capital
4,000,000
F, Capital
5,000,000
The following additional notes are provided:
All partners are legally declared to be personally insolvent.
All noncash assets are sold during the liquidation process.
Liquidation expenses amounting to P2,000,000 were paid.
• E receives a total of P2,500,000 at the end of liquidation.
What is the amount received by F at the end of liquidation?

Definition Definition Arrangement between two or more people whereby they agree to manage business operations and share its profits and losses in an agreed ratio. The agreement drafted and signed by the partners of the firm is termed as a partnership deed and contains various important clauses agreed between the partners such as profit/loss sharing, interest on capital, remuneration allocation of each partner, and drawings of a partner.

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